Licence to Assign Heads of Terms
This Licence to Assign Heads of Terms is designed to ensure that the landlord, tenant and assignee agree all significant points of principle before the landlord issues a Licence to Assign for signature.
Commercial leases tend to prohibit assignment of the lease without the Landlord’s consent. During the term of a lease, the Landlord may well receive a request from the Tenant for consent to assign. The Landlord’s consent is usually given by way of a formal Licence to Assign.
Usually, the Landlord will be under a duty “not to unreasonably withhold or delay consent”. The Landlord must therefore deal promptly with the Tenant’s request for consent and must either agree that consent will be given or give reasonable grounds for refusing consent. (It might be reasonable to refuse consent, for example, if the Landlord reasonably believes that the proposed assignee will not be able to afford the rent). If consent is to be given, the Landlord should prepare and issue these Heads of Terms and then prepare a draft Licence to Assign.
This template is suitable for any type of commercial property, including shops, restaurants, offices and industrial premises. It can be used in conjunction with the Licence to Assign template.
This document prompts the parties to record administrative information, such as their contact details, and details of the lease, and to set out what has been agreed in relation to the assignment, including whether the Tenant is to enter into an Authorised Guarantee Agreement and any fees payable by the Tenant.
This template is duplicated in the Commercial Occupiers group of documents under Assignment of Leases.
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